While speaking as part of an expert panel at the 9th annual InterFace real estate conference this week, I was struck by the discouraged tone. It was a tone I had never really heard before from this group of experienced CRE professionals.
The panel included some of the most veteran brokers and investors in the region, including Frank Baird of Capital Associates, Ryan Clutter of HFF, Charles Jonas of Foundry Commercial, and Tom O’Brien of Studley.
The outlook was gloomy, and all the talk was about dropping demand for space.
Of course, the concern about the drop in office tenant demand is legitimate; although 2017 was an epic year, all of that “epicness” was confined to the first three quarters. Demand has dropped precipitously since. No one really understands why – Raleigh and Nashville’s office markets are on fire.
To me, it felt more like it was wounded morale from having lost Amazon and the AllianceBernstein office expansions. Nashville is the lucky city that will benefit from AllianceBernstein’s $70 million investment in new office space, while Raleigh is still in the running for Amazon. Rumors also abound that Apple is coming to the Triangle.
Negativity happens. It’s easy to see obstacles, bad news, and get wrapped up in the tough breaks.
It’s time for Charlotte to bounce back with an innovative economic development effort.
But it sure seems like many in the city are feeling vulnerable. Personally, I think a few quarters of slow tenant demand doesn’t make a crisis. This feels more like a collectively bruised ego.
Charlotte needs to engage in the war for jobs. South Carolina, Alabama and Georgia got in the trenches over 20 years ago. As an example, South Carolina started recruiting German and Chinese investment in the late 1970s. Thirty years later there are tens of thousands of jobs tied to Chinese and German investment.
I have served on the NC Economic Development Board and many Charlotte Economic Development committees during my career. And in spite of what we do to dissuade companies from relocating here, I’ve always said North Carolina is successful at recruiting talented companies and talented workers.
Here is what we have to do:
- Elect leaders who are competent at economic development.
- Fund the Charlotte Regional Partnership 10X – Their budget reflects the fact that economic development is not a priority for this region.
- Accept that there is a job war going on and that we are the underdog.
We have to remember our wins. Get a vision for a future city that is 10X greater than we can imagine. Double-down on the Queen City with an innovative, forward-thinking, job-snatching plan.